reinsurance division

Natural perils are becoming more significant in aviation: windstorms, tornados, flooding and hail, just to name a few. The unpredictability of events is increasing; for example, we are seeing an increase in the frequency of tornado activity in the U.S. and of clear air turbulence around the world.

And what about the rise in eVTOLs? Due to sustainability factors, we are increasingly seeing prototypes coming to market. Many challenges lie ahead in terms of technology, safety, cost, noise, pilot qualifications, etc. What will the exposure look like once these vehicles carrying passengers start flying through big cities?

W hat about cyber? It is one of the most rapidly developing risks facing the insurance industry. Studies show that attacks in aviation are increasing, mainly aiming to disrupt normal aviation operations. For the aviation insurance, the impact of these events is limited as business interruption and data breach losses are not typically insured in our market. However, a large cyber event causing physical damage and / or bodily injury in a multiple aircraft scenario could potentially have disastrous consequences.

We have also seen a rise in near mishaps at several airports in the U.S. Just this past January, we read about the near-collision between an American Airlines and a Delta Airlines aircraft — both fully loaded with passengers — at JFK airport. Thank goodness a collision did not occur.

A new and evolving risk landscape with a change in risk exposure cannot be ignored. As a market, we need to continue to think forward and adapt. Data may play a role in forecasting the new challenges. Predictive and behavior analytics could help us better understand and anticipate potential threats and better capture the exposures.

We must recognize the “what’s next” scenario and the changed risk landscape to be prepared for potential catastrophes before they occur.

Raffaella Basile is Chief Underwriter Aviation with Swiss Reinsurance Company in Zurich, Switzerland, and an aviation expert in both insurance and reinsurance whose career spans 25 years in various roles. She assumed the position of AIA Director of Reinsurance in 2022.